A new Xbox 360 SKU is starting to appear on store shelves –
but Microsoft hasn’t officially told anyone about it yet. Gamers knowing the
differences between each of the various Xbox 360 models have snapped pictures from
retail showing a new Xbox 360 Arcade package selling at $279.99.

At $279.99, the Xbox 360 Arcade hits at the exact same price
as the Xbox 360 Core system – and will likely become the new entry-level SKU
for Microsoft’s console. The new Xbox 360 Arcade package will improve upon the
Core in several ways. While there will not be a standard hard disk drive, the
Arcade system will ship with a 256MB memory unit – an accessory that previous
Core buyers had to purchase separately. Another upgrade that the Arcade unit
enjoys over the Core is the move to a wireless controller complete with a set
of free Energizer AA batteries. Previously, only the Xbox 360 Premium and Xbox
360 Elite came with wireless controllers.

Pictures of an unboxing
process hosted at Engadget reveal
that the Xbox 360 Arcade system features an HDMI port, even though only a
standard-definition composite cable is bundled. This means that the Xbox 360
Arcade ships with either a Zephyr motherboard – the first Xbox
360 revision to include HDMI – or a Falcon motherboard, which added further improvements while
shifting the CPU from a 90nm process to 65nm.

The Xbox 360 Arcade system gets its name from the Xbox Live
Arcade compilation disc included with the system. Games a part of the pack-in
are: Boom Boom Rocket, Feeding Frenzy,
Luxor 2, Pac-Man Championship Edition and Uno.

My launch 360 is still running like a champ. My other one (bought several months in) had a bad video controller. I'm pretty sure you'll be safe no matter which one you buy. There are no official stats, so it's hard to guage. Take some assurance in knowing that the return process is painless (it was for me) if you should have a problem.